Sign in to follow this  
I_Smell_Tuna

Retail Distribution

Recommended Posts

Although I have about 3-5 years to think this over while I develop my video game, I figured I'd go ahead and get a head start on it. I did some research and found out that with all the major retail chains (Wal-Mart, EB, GameStop, Target, KMart etc) I will have to get large quantities of my video game to their distribution centers, which when totaled up comes to about 170, (Thanks Google) although I do expect it to rise to about 180 as smaller chains come to mind. Anyway, my question is does anybody have experience with retail distribution? My plan is to find a facility with a loading dock that will double as my storage and production facility. From here I will be able to schedule pickups of my video game. I googled freight carriers to find the cheapest solution but was unable to get any decent quotes. Then FedEx and UPS came to mind, the shipping giants. They have regular routes, and probably already do devliveries to these distro centers. Does anyone have any experience with this, or thoughts on my plans?

Share this post


Link to post
Share on other sites
Since you dont even know if your game will take 3 or 5 years to complete, i definitely dont think youre ready to do major self-publishing of it.
Turn to one of the existing publishers, they have everything in place for this.
And these are the guys you have to compete with for shelf-places, which are expensive (you did know it costs quite a bit of money, right?)

Share this post


Link to post
Share on other sites
Actually I DO know that it will take 3-5 years to complete. A review on the development of any major game will tell you this. But I'm not counting on that, I've broken down the tasks that need to be done and estimated the time it will take to complete them. I know it's going to cost money, although not tens of millions. Please stay with the topic.

Share this post


Link to post
Share on other sites
I'm going to have to echo tok_junior on this. If this is your first commercial title, you might be better off trying to go with one of the major publishers, who would take care of production, shipping, marketing, etc. The advantage of this is that it would be less risk on your part because you don't have to make as big of an initial investment. If your game is good, then you will likely also get more exposure this way due to the publishers significantly larger budgets. The disadvantages are that you would have to take only a cut of the profits, and you would miss out on a potentially very educational experience in running your own business.

I apologize for the slightly off topic post if you are dead set on running everything yourself, but my recommendation would be to at least look into using a publisher if you haven't already so you know what your options are.

Share this post


Link to post
Share on other sites
Quote:
The idea is to cut out the publisher to get the maximum profit out of the sales


Using the method you describe (and assuming that Walmart and EB would even TAKE your product...without a publisher this is VERY unlikely), you'd be lucky with a 5% profit margin.

Consider the alternative of online distribution where a profit margin of 20% is not hard to acheive and you don't have to worry about shelf space or delivery charges or tracking or publishers...

5% and an uphill battle vs. 20% and a website...you be the judge.

Share this post


Link to post
Share on other sites
Online distribution doesn't reach nearly as many people as retail does. I'm in it for the profit, and the business experience. I'm talking about retail distribution and you think I don't already know it's going to be hard and cost money? The work and risks are big, but so is the payoff.

Share this post


Link to post
Share on other sites
I'm not an expert in the business side of game publishing by any means, but from what I've read I think that the big retail chains (EB, Target, Wal-Mart etc.) will only deal with their distributors, and the distributors only deal with the established publishers. It is nigh on impossible for a small developer to publish their own game (sans publisher) through these channels.

You would be far better off going with a publisher if you want to see your game on store shelves. From what I've read the indie publishers such as PopCap and GarageGames offer a good percentage return. Sure, you'll make less percentage profit on each sale, but if you can exponentially increase the amount of sales you make you'll make more money overall.

The other approach is to make your own website to distribute your own game. You'll keep most of the money you make for each sale, but your number of sales due to your decreased market presence is likely to be small. You are also totally responsible for your own marketing, which is crucial since without it no-one will know your game exists.

Share this post


Link to post
Share on other sites
Stores like EBGames, Walmart and Target only deal with large distributers. Unless you have a number of titles going out every year you will not get them to carry your game.

Also the money you are looking at is really in the millions. Dev costs, storage space, and shipping are only the first expenses. The next is shelf space. Getting Walmart to look at your game is only the first step. The next thing they will want is money for shelf space. If you want good shelf space it's going to cost big $$. Next they will want to see your marketing plan. If you're not planning on spending big money on tv or magazine ads then they will not take your game.

Back of the napking budget base on selling 100,000 copies of your game (which is a huge amount btw)

1. Cogs (DVDs, box, shrink wrap, etc.) ~ $3-5 a unit = ~$400,000
2. Shelf space ~ $2-3 a unit = ~$250,000
3. Minimum advertizing campaign to be taken serious ~= $500,000
4. Shipping, storage, infrastructure ~= $250,000

Grand guestimate : ~$1.5 million?


Share this post


Link to post
Share on other sites
Quote:
Original post by I_Smell_Tuna
These major chains have their own distribution centers. Go to any of their websites and they have job listings for their distribution centers under Careers. I'm also aware of marketing and what sells games.

That's right, but you'll have to convince the distributors to accept your game. From my understanding from how the business works, that will not be easy for a single small developer to do. And by "not easy", I mean on the scale of "for all intents and purposes, impossible".

Thinking this through from the point of view of a distributor, it is far better for them to talk to people like an agent from a big publisher like EA, where they can get dozens of titles that they know will sell, rather than deal with individual small companies that only offer one title that may or may not sell (from their perspective).

If you are serious about selling your title retail, you will need a publisher. They'll provide you with support that you will need, such as qualified staff who know how to deal with the big chains, legal representation, marketing, quality assurance and the like. There's just too much risk and work involved for a small company to deal with all of that themselves. If you want to sell your game entirely by yourself, I recommend selling on-line only.

Share this post


Link to post
Share on other sites
Everyone: Why are you so pessimistic?

You guys didn't read my post clearly enough. These large chains have their own distribution centers, meaning they own them. I shouldn't be dealing with any third party distributors. Here are the number of distribution centers each chain has.

Wal-Mart 110
Target 29
Best Buy 8
EB Games 1
GameStop ?
Circuit City 1
KMart 18

This info comes directly from their websites. Why would there be any need to deal indirectly with these chains? It's not like there are generic video games like other products where a third party is required.

Also my accurate estimates backed by months of research put your 'guestimate' off by several hundred thousand dollars. You may be correct on your marketing/advertising costs, but your costs per unit is way off. A single unit can be produced for under a dollar. If you wanted to be cheap about it you could probably get away with making it for under seventy-five cents. And I doubt shelf space is that much, although I have nothing to back that up.

Share this post


Link to post
Share on other sites
Guest Anonymous Poster
Please, stop dreaming and start to listen to these guys. They know what they are talking about. You don't.

You simply have no chance in hell to get onto Wal-Mart's shelves without a publisher.

I'd recommend that you publish your game online. At www.indiegamer.com is a forum filled with people with that kind of experience.

Share this post


Link to post
Share on other sites
You just wont be able to buy any shelf space the big boys have it all tied up, EA isnt about to lose a foot of shelf space to allow you in, and Wal Mart arnt going to upset the big guys by restricting their space. You will have no proven track record which you could use to persuade them otherwise. Also you say you can manufacture a game for under a dollar, well maybe you could but its going to look cheap and you arnt going to convince anyone its a quality title in a cheap jewel case with a folded bit of paper as the manual. Listen to the guys like Dan (Obscure) who have been in the industry long enough to know. I myself have worked with Virgin, Sony, Ubisoft, Eidos so I have a little idea what the costs are.

Share this post


Link to post
Share on other sites
Guest Anonymous Poster
I'm just wondering how many copies you'd need to sell to cover all those expenses. Just for development:
say 40 people working for 5 years at $50,000 per year = $10 million

if you can get away with 20 people working for 3 years that's still $3 million. Add to that other development costs and marketing and so on, and you get a pretty high sum. So how many units would you roughly need to sell to break even? You should probably also look for titles that managed to sell that much and compare their budgets to yours.

Bojan

Share this post


Link to post
Share on other sites
Blah blah blah, I don't have the ambition of a successful businessman. People like you don't have my ambition, knowledge, ability, and resources to do what I want to do. These people don't know what they're talking about 'I'm not an expert...', they don't know me, or the situation, they're just regurgitating info they read somewhere on the internet, and talking about conventional methods.

I WILL get on Wal-Marts shelves and I won't settle for less.

I recommend that you follow one of your dreams and stick with it.

Share this post


Link to post
Share on other sites
Get a game made (or mostly made)before you worry about selling it. You're going to be in for a rude awakening in that step alone. You have to have a product to sell it.

Share this post


Link to post
Share on other sites
Quote:
Original post by I_Smell_Tuna
Everyone: Why are you so pessimistic?

The reason why I'm so negative is that I like to see GDNet people succeed. You are not going to get your game boxes on the shelves of Wal-Mart without going through a publisher.

To re-iterate my previous post, image you are the distributor for Wal-mart. Why would you schedule a meeting with some guy who wants you to stock a single game on their shelves, when you can speak with the representative from a big name publisher who will offer you dozens of titles, and has a proven sales track record to boot?

Or to put it another way, look at Valve. They go to the trouble of setting up Steam in order to sell their games on-line, but when it comes to selling their games in boxes at retail, they go through Activision. If Valve has to use a publisher to sell at retail, with a big smash hit already behind them, then for someone to go without a publisher on their first title just looks foolish, business-wise.

You have to look at why you are wanting to make this video game. Is it because you want to sell squillions of copies? Or it is because you want to see your shiny game box in stores and say to yourself "I made that! There's my game, on the shelves!". If so, then you will need a publisher.

However, is it because you want to make games on your own, without a publisher telling you what to do? Or is it because you want the experience of running everything about your own business, including the publishing and marketing? If so then I suggest selling your own game on-line, or through an indie portal.

Maybe you want a little bit of both? Then you can sell your game through an indie-friendly publisher, like PopCap or GarageGames. You might have to trade-off some of your goals against each other, but that's how business works.

Or maybe your goal is to make truck loads of cash? If so, I recommend a different industry [smile].

Sorry if this comes across as a bit harsh, but I honestly think you have no chance of succeeding at selling your own game to the retailers without publisher help. It is far more prudent to either aim towards getting a publisher, or publishing on-line. I'd rather see your game finished in one of those formats then have you fail because you aimed for an impossible target.

Best of luck with your game!

Share this post


Link to post
Share on other sites
Guest Anonymous Poster
You are rather laughable, you are going to develop a game for $50,000 over 5 years, you expect that game then to be a AAA title so you can get it into Wal Mart, great ambition but learn to wak first man, just looking at your other posts, youve asked about duplication equipment, Jewel of CD cases, credit card transactions, which indictaes you really dont have any idea at all. You say you have the drive to get this done but yet you ask for help and advice and then totally ingore anything you dont want to hear, fine thats your call. So I suggest you just dont bother with the people who's advice you sought and leave your nonsense of this forum until you have something ready or have a little more knowledge :)

Share this post


Link to post
Share on other sites
The game design has not been left in the dust, however no good business plan is put off until after development. When did I mention only selling one title? I'm wanting to make a video game for all the reasons you stated. I'm trying to make a game that the world can enjoy yet still make me a few briefcases full of cash at the same time. I take it none of you have ever seen The Aviator. And the replies that people make are completely off topic, and not what I'm aiming for, yet they persist even after being informed of it.

Share this post


Link to post
Share on other sites
Guest Anonymous Poster
Quote:
Original post by I_Smell_Tuna
And the replies that people make are completely off topic, and not what I'm aiming for, yet they persist even after being informed of it.


Quote:
Original post by I_Smell_Tuna
Does anyone have any experience with this, or thoughts on my plans?


so technically they're not off topic, they're just thoughts on your plans.
Sorry, couldn't resist ;-)

Bojan

Share this post


Link to post
Share on other sites
Quote:
Original post by I_Smell_Tuna
The game design has not been left in the dust, however no good business plan is put off until after development. When did I mention only selling one title? I'm wanting to make a video game for all the reasons you stated. I'm trying to make a game that the world can enjoy yet still make me a few briefcases full of cash at the same time. I take it none of you have ever seen The Aviator. And the replies that people make are completely off topic, and not what I'm aiming for, yet they persist even after being informed of it.

Well it does help if, like Howard Hughes Jr., you have a massive family fortune to help you achieve those dreams [grin].

Assuming you don't though, I'd think about which of those goals matters the most to you. By trying to have it all, it's most likely you'll give up the opportunity to have anything.

If you want someone to reply completely on-topic, then it's unlikely. Nearly no game developers do not have any experience with dealing with retail distribution, because the publisher deals with all of that for them.

Look, I don't like being negative, but you really aren't listening. I know you've got amibition; a lot of people here do. But while it's fine to aim to for the moon, at least realise that you'll have a better chance of making it there if you deal with NASA rather than build a rocket ship yourself [smile].

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

Sign in to follow this